Beginner Archives

Join our paraplanning panel as they discuss how they approach cash flow planning.

Learning Objectives

In this session we covered…

We’ll be using CashCalc and Voyant again
We’ll do a deeper dive into hows to start building a cash flow (bring your armbands)
We will also look at scenario planning, assumptions, problem solving and capacity for loss in more detail
And like always, you can ask questions and share tips with fellow paraplanners

Our friends at Aegon are doing a lot of work around financial wellbeing. Dr Tom Mathar, Centre for Behavioural Research, Aegon UK and one of the experts on this online assembly, would like to share some thoughts with you.

Life is unpredictable and changes constantly. But what remains is our need for financial security and peace of mind. And with the rise of DIY platforms and robo-advice breaking through an industry focusing on three things – alpha, asset allocation and charges – the value of advice needs to go further. That’s where financial wellbeing can play its part.

So what is financial wellbeing?

Financial wellbeing is how people feel about the control they have over their financial future – and their relationship with money. It’s about focusing on the things that make their life more enjoyable and meaningful – both now and in the future.

What we focus our mind on matters

Everyone’s idea of financial wellbeing is different – from having enough money to live comfortably, making large purchases (planned or unexpected), to being able to repay outstanding debts, as well as being on track with savings and pensions to cover later life.

But you can easily break financial wellbeing down into two things for your clients:

Financial resilience – do they have enough to pay for what they need now and in the future.
Focus – are they paying attention to what really makes them happy.

Financial wellbeing building blocks

We found that money building blocks and mindset building blocks are necessary to build financial wellbeing.

As part of our latest research[1] we asked people about their financial resilience and their ‘mindset’ – how they think about money, and we created a scale to help clients picture it:

5 money building blocks

Income
Rainy day fund
Manageable debt
Smart long-term savings
Valuables that make us feel secure long term, like property

5 mindset building blocks

Knowledge of what makes us happy
A solid picture of our future self
Savvy social comparisons
A long-term plan
Strong nerves in a crisis (resilience)

But it’s also about balance. Even if your clients have their money building blocks nailed, they won’t achieve optimal levels of financial wellbeing without a well-considered and focused mindset too.

What was clear from our research was that mindset scores were lower than money scores, and the mindset scores didn’t improve at the same pace as peoples’ incomes were.

Find out more about our building blocks and what our research tells us about them in our digital flipbook

Common mindset problems

Lower mindset scores were a result of several factors including:

38% of people have only a vague idea of where they want to be (financially, socially, physically etc) in 10 years’ time vs 29% with a specific idea.
28% have only a vague sense of what gives them joy or purpose which are key elements of happiness.
87% of people don’t have a financial plan to achieve long-term goals.
16% of people frequently compare their finances to the finances of those better off than them with younger people far more likely to do so.
Only 17% of people were able to answer at least four out of five basic financial literacy questions correctly.

Five tips to adjust your client’s mindset and improve their financial wellbeing

Use the tips below with your clients to reframe your conversations and check-ins and encourage them to think about what gives them joy and purpose.

Ask them to put happiness first – alert them to be conscious of the things that give them sustained happiness – be that joy or purpose. And that they’re spending time, energy and money on those things with their future happiness in mind.
Savvy social comparisons – if they’re making social comparisons, encourage them to be healthy and realistic, instead of them comparing to people whose financial lives appear better. Or even suggest they use their past self as a comparison to measure how far they’ve come.
Help them picture their future self and lifestyle – encourage your clients to spend time regularly visualising their future self and what they might be doing. By paying attention to the life they want to live, pension and investment goals to achieve that lifestyle, can keep them on track. It’s also important for your clients to think about what protection they have in place if something unexpected derails them.
Make a long-term plan together and write it down – people who write out a financial plan save more regularly and do better financially.
Reassure them to hold their nerve in a crisis – if your clients are tempted to change their long-term investments, get them to remember why they started saving so they don’t panic and do anything they might regret.

Get started

We’re committed to working with you to help identify advice opportunities and support your clients throughout their lifetime.

To read our research in full and share with your clients, download our digital flipbook – How you can improve your financial wellbeing

We’ve also created a summary guide of the research – Our insight into the nation’s financial wellbeing – designed especially for intermediaries, paraplanners and employers.

For other financial wellbeing support and research, visit aegon.co.uk/financialwellbeing

[1] Research conducted in August/September 2020, based on 10,466 nationally representative UK residents

A team of paraplanners and an expert dissect a case study looking at pensions and divorce.

Learning objectives

In this session we covered….

Where to start with divorce cases
The options for dealing with pensions
Dealing with other assets
Working out a suitable solution for both parties
What other financial actions should be looked at

A session dedicated to cash flow modelling. Questions are of all levels are put to the panel as they share how they approach this topic.

Learning objectives

In this session we covered…

What’s cash flow modelling all about and why you should be doing it
The benefits for paraplanners
The benefits for clients
Best practice and top tips
Live software demos

Think of this as your Paraplanners Protection Toolkit, perfect for:

Anyone with limited protection experience Anyone who wants to increase their understanding and want to introduce more protection into client plans Anyone who thinks they know it all but wouldn’t mind brushing up a little

Learning objectives

In this session we covered…

What is protection – a potted history
Difference between assurance and insurance
What is a life assurance company?
What is reassurance company and where do they fit in?
Who needs protection and why?
The protection gap Why isn’t protection sold?
How can paraplanners influence the inclusion of protection in a plan?
Technical talk – what makes up a typical life policy and some jargon busting

Did you nearly get RSI writing down all the research and analysis tools paraplanners rate in this online assembly? If you missed a few or just couldn’t keep up, you are in luck as we have popped them all down here.

Plus if you missed the actual live event, watch it here to find out more on why we rate these tools and what we find them useful for.

Fund research

FE Analytics (helpful assemblies on this tool are here and here)
Trustnet
Morningstar
Fundecomarket
Worthstone (Their next Impact Investment Academy is on Tuesday 16th November 2021 and can be found here)
Ethical Screening
DD|hub

Wrapper and product research

Technical researcH

Financial planning

These are sites to find out general information and do analysis and planning research.

Prudential Tools & calculators
Royal London salary sacrifice calculator
Age UK
TFP Calculators
Listentotaxman
The Salary Calculator
Reverse Tax Calculator
State Pension Age Calculator
ONS Life Expectancy Calculator
Money Advice Service
Mortgage Overpayment Calculator
Royal London rates & Factors
Just CY calculator
Invidion
Vanguard Pension Calculator
BOE inflation calculator
Voyant
Cashcalc
Moneyscope
Timeline

Others

Advisersoftware

Remember, you can watch the show here and if you have any more questions, people are always happy to help on the Big Tent.

If you’re starting out in paraplanning, this is for you. Our experts share their experiences and knowledge to help you work out your next step.

Learning objectives

In this session we covered…

What’s the hiring market like right now?
The trends
The drivers
What employers are looking for – the importance of both the right skills and right behaviours
The challenges aspiring paraplanners face
How you can increase your experience and set yourself up for success
What’s the best way to approach a potential employer
What to expect from the job
What salary to expect
The support available

In November, Susan Pringle was joined by Dr. Tom Mathar of Aegon UK to explore behavioural science. You can watch the replay. We enjoyed the Online Assembly so much that when the team at Aegon shared an article about the effect of working with clients in an online environment, we thought it would make an interesting follow up.

So…once more, over to Dr. Tom..

The online encounter

Why clients are more comfortable with an online relationship than you may think

Coronavirus forced many of us to move out of our carefully arranged offices into a home environment and made video calls more prevalent. And with that move, advisers and paraplanners are now faced with the challenge of trying to acquire new clients from their own homes.

The physical cues normally used to get messages about themselves and their business across may be lost. Clients, however, will continue to look for these cues that ultimately encourage them to build trust. So, it’s important to carefully think about the messages the background of video calls can convey.

Subliminal messaging works

The norm of reciprocity means clients are more likely to give away something personal (their concerns, requirements, hopes and aspirations) if you share something personal too – either implicitly or explicitly.

In 2020, we asked 2,100 members of the Aegon Feedback Community what should present itself in the background of a video call – most of our respondents said it should be ‘clean’. Although references to achievements and professional background (for example, awards and certificates) are considered acceptable too.

But subconsciously, sharing deeper personal references such as family connections, seems a more powerful way to enter a reciprocal relationship.

Our study also suggests that using references to your personal wealth or social status (for example, exclusive art or interior design) could stop prospective clients from entering a relationship with you[1]. Similarly, blurring the background could also put you at risk of not building an open, trusting relationships with clients. This, however, may differ with the client segments your firm typically serves.

Share and share alike

The TrustedAdvisor’s Trust Equation[2], uses four variables to measure trustworthiness:

Credibility (which has to do with the words used in client interaction);
Reliability (which has to do with actions);
Intimacy (relates to the safety / security we feel when engaging with someone), and
Self-orientation (refers to your focus and, more specifically, if you seem focussed on the client or yourself).

Of all four, intimacy is considered the most powerful component. Intimacy refers to the sense of security that someone gets when they engage with you. They want to know that everything they share with you will be treated with respect and propriety.

In our report Building trust with prospective clients, we look further into the Trust Equation – how only by giving something will you likely get something back, and by sharing your own hopes, fears and aspirations you will invite the same from your clients – and how this can help to develop a deeper understanding of their financial motivations.

How you and your clients adapt

Pollster Opinium[3] found that the majority of advisers (59%) said that ‘working with clients remotely’ is the main challenge they’re currently facing when adopting to Coronavirus disruption.

Before the pandemic, 84% met their clients in a face-to-face encounter ‘often’ or ‘very often’ and only 7% used video calls. Going forward, 70% assume they’ll meet their clients face-to-face ‘often’ or ‘very often’ – and 38% say they’ll meet clients using a video call.

Opinium’s research also found that clients would now prefer to meet their adviser in a video call after the pandemic, rather than return to face-to-face meetings as they become increasingly more at ease with the idea of an online relationship.

And in our own research, crucially, those who think this are the Career-driven families and Upper Echelons customer segments, who have significantly higher assets than average and are more likely to work with an adviser.

Summary

It’s likely that video calls will continue from now on, so it could be worthwhile thinking about which supportive cues are right for your clients and business’ brand.

And it’s worth noting the variables in the Trust Equation have become much tricker to manage with the move from office to online meetings. In a video call it’s a careful balance between conveying the right levels of intimate messages about yourself without seeming as if you’re pushing your own goals onto your clients. Getting the right blend can have a significant impact on client trust and your business.

You can read more about the research and our findings in our two reports:

Increasing client trust during video calls

Building trust with prospective clients

[1] Aegon Feedback Community, 2,100 respondents, 2020

[2] trustedadvisor.com, the Trust Equation, 2020

[3] Understanding the impact of Coronavirus on the investment landscape. Opinium, 2020.

Thank you Dr. Tom and Aegon UK. 👍

We like a collaboration, and that’s exactly what we’re doing with Aegon where we’ll cover tax topics in these video shorts. Think tax topics cut into easily bitesize videos that you can watch on the go.

Whizzing us through the tax topics is Elaine Cruickshank.

Elaine is a qualified account and member of STEP. She is Tax and Trusts Manager in the Aegon retail sales team and has been with Aegon for 17 years. She provides tax and trusts support to the Aegon retail and protection sales teams and advisers. She is Aegon’s tax and trusts spokesperson – writing articles, delivering webinars and presenting at seminars.

There’s five videos to dive into covering:

Capital losses
Taking money from a bond
Shares and capital gains tax
Scottish rate of income tax
IHT planning

So, don’t delay, get watching and if you find these useful let us know and we will make some more.

So what can you expect from a technical short?

Here’s Richard to explain what you can expect from this series.

Capital losses with aegon

Taking money from a bond

Shares and capital gains tax

Scottish rate of income tax

IHT planning

Understand the importance of behavioural science within paraplanning.

Learning Objectives

In this session we covered…

Influencing advisers
Applying behavioural principles in client communication
The EAST framework
Why picturing their future self tells you more about a client than their income
Building trust
The power of ‘pre-suasion’
Self behaviour tips for dealing with stress